Prime Minister Cameron promises Britain more freedom from European Union

LONDON — Laying out a new, more independent road map for Britain in Europe, Prime Minister David Cameron pledged Wednesday to hold a referendum within five years on continued membership in the European Union, stoking fears in Washington and across the region of a rupture between London and its neighbors.

Cameron’s crusade to redefine London’s relationship with Europe comes despite warnings from the Obama administration, which has cautioned of the risks of a referendum that could diminish the voice of the leading advocate for U.S. policy in the region. The prime minister’s move also cast a shadow on grand dreams of a more deeply integrated Europe and drew sharp criticism from some quarters of the continent, particularly from the French.

The announcement signaled a new course for Britain, a nation that has sought for years to heed Winston Churchill’s adage and be “with Europe, but not of it.” Although Britain has maintained its own currency, the pound, and stands outside one of the region’s major customs treaties, it has nevertheless remained a full member of the 27-nation E.U., which has strived to build the world’s largest integrated economy, governed by common laws and open borders.

But in what was seen as the most pivotal speech on Europe by any government leader here in decades, Cameron vowed to reclaim sweeping powers from the E.U.’s administrative capital in Brussels, even if Britain stays in the union. Citing growing resentment in Britain of the E.U.’s slow bureaucracy and meddlesome edicts, Cameron declared, “It is time for the British people to have their say.”

“We have the character of an island nation — independent, forthright, passionate in defense of our sovereignty,” he said. “We can no more change this British sensibility than we can drain the English Channel.”

If Britain did leave the E.U., the country could suffer a severe blow as a global banking center and could see its clout in regional affairs and European foreign policy greatly weakened. Such a move could also require a new immigration agreement to settle the status of millions of European nationals living here as well as British nationals living on the continent. A British exit would also be a hard setback for the E.U., depriving it of an economic and military power that enjoys one of the biggest global footprints of any European nation.

Cameron, who has come under intense pressure from an anti-Europe right wing of his Conservative Party to call a referendum, acknowledged in his speech that he thinks Britain is stronger within the E.U. and should remain part of it. He warned those itching to leave that Britain, as one of the region’s strongest powers, should stay at the heart of Europe’s future and not on its fringes like other non-E.U. nations, including Norway and Switzerland.

But he suggested that his support for continued membership is contingent on winning exemptions for Britain from some common European labor laws, judicial decisions and other regulations. “I am not a British isolationist,” Cameron said. “But I do want a better deal for Britain.”

‘Europe a la carte’

To be sure, his call for a referendum essentially amounted to a campaign promise: Such a vote could happen only if the prime minister’s party, now trailing in the polls, wins the 2015 elections. But the announcement capped months of hints from Cameron that he might support Britain’s first referendum on its association with the continent since the 1970s, and it sets up an extended period of uncertainty when banks, businesses and traders must assess the economic risks of a referendum.

Britain cannot have “Europe a la carte,” French Foreign Minister Laurent Fabius said in a radio interview Wednesday. While warning against a departure, he added that he recently told notable British businessmen: “Listen, if Britain decides to leave Europe, we will roll out the red carpet for you” — a reference to Cameron’s statement last year that Britain would “roll out the red carpet” for French businesses escaping President Francois Hollande’s high taxes.

Cameron’s deputy prime minister, Nick Clegg, who represents the government’s junior coalition party, the Liberal Democrats, joined the opposition in saying that the move would leave the world guessing about Britain’s economic and political future.

“My priority and certainly the priority of the Liberal Democrats is to build a stronger economy in a fairer society,” Clegg said. “Now that job is made all the harder if we have years of grinding uncertainty because of an ill-defined, protracted renegotiation of Britain’s status within the European Union. That, in my view, will hit growth, and it will hit jobs, and that’s why in my view it’s not in the national interest.”

Anti-E.U. sentiment

Although his announcement was seen as an attempt to appease his party, Cameron also appeared to be tapping into broad anti-E.U. sentiment in Britain. A sizable percentage of the population here blames the E.U. for waves of immigration and supranational laws determining such things as the maximum hours in the British workweek and the price of car insurance.

However, as the prospect of a referendum becomes more real, at least one poll by London-based YouGov indicated that support for leaving the E.U. fell from 51 percent in November to 34 percent last week.

Whether Britain can win back powers and stay within the E.U. remains in question. The continent’s most influential nations, Germany and France, are concentrating on saving the common currency, the euro, and observers say neither will want to expend much time addressing the concerns of a country that has often sniped at their mishandling of the crisis from afar.

“The French will be rolling their eyes,” said Nicolas Veron, a senior fellow at Bruegel, a Brussels think tank. “The euro zone is moving toward integration, and British cooperation would be better. But if the Brits are unconstructive, Europe will move forward without them. This doesn’t create goodwill.”

Nevertheless, the referendum threat could be Cameron’s trump card. While France has seemed relatively indifferent about Britain’s membership in the European club, the Germans have more actively sought to keep London within the fold. On Wednesday, German Chancellor Angela Merkel struck a diplomatic tone on British demands.

“Europe means finding fair compromises,” she said. “First we will have to establish a common medium-term financial plan. This is also in the interests of the British.”

Warnings from Washington

Cameron’s announcement came despite calls for caution from across the Atlantic. This month, Philip Gordon, U.S. assistant secretary of state for European affairs, took the unusual step of publicly saying that Washington’s best interest would be served if Britain remained in the E.U.

Cameron acknowledged those concerns, arguing that his push could force broad changes in the E.U. that would not only allow Britain to remain a vibrant part of the union but also would transform the organization into a leaner, more flexible and faster-moving body. “There is no doubt that we are more powerful in Washington, in Beijing, in Delhi because we are a powerful player in the European Union,” Cameron said.

But he appeared to have succeeded at least in appeasing the growing number of euro skeptics in his party, with Conservatives here pushing back against the notion that an exit from the E.U. would harm U.S. interests in Europe.

“The government needs to renegotiate back to the economic and trade relationship we wanted, with no European influence over our judicial system or our labor, welfare or social laws,” said Liam Fox, a Conservative parliamentarian and Cameron’s former defense minister. “And I think it’s up to the British to decide whether we’re in or out. You know, when it comes to military allies, it’s not the Europeans that pop up for the U.S. It’s the British.”

Eliza Mackintosh in London and Michael Birnbaum in Berlin contributed to this report.